Many Economists View a 3% Annual Inflation Rate as "Acceptable

Multiple Choice

Many economists view a 3% annual inflation rate as "acceptable". Assuming a 3% annual increase in the price of automobiles, how much will a new Suburban cost you five years from now, if today's price is $48,000?

A) $41,405
B) $48,000
C) $54,024
D) $55,200
E) $55,645